• Republicans included a major victory for AI companies in Trump's sweeping "Big Beautiful Bill."
• One provision would prohibit states from regulating artificial intelligence for a decade.
• OpenAI and other companies have opposed state-level regulations.

Major tech companies could receive an unexpected victory in President Donald Trump's signature "Big Beautiful Bill" but they shouldn't start celebrating just yet.

House Republicans squeezed a provision into part of the sweeping tax, immigration, and defense legislation, which would prohibit states from regulating artificial intelligence for a decade.

"Except as provided in paragraph (2), no State or political subdivision thereof may enforce any law or regulation regulating artificial intelligence models, artificial intelligence systems, or automated decision systems during the 10-year period beginning on the date of the enactment this Act," the bill reads.

The text, first noticed by 404 Media, would be a godsend to major tech companies that have pushed the White House to oppose state-level AI regulations. Meta previously told the White House that such regulations "could impede innovation and investment."

OpenAI, Meta, and Alphabet have all opposed state-led efforts to regulate the rapidly growing industry. Last year, California Gov. Gavin Newsom vetoed what would have been one of the nation's furthest-reaching AI laws after it overwhelmingly passed the state legislature. OpenAI was among the leading tech companies to oppose that bill.

Congress has considered federal AI policies but those efforts have yet to go anywhere.

Big Tech CEOs have made substantial efforts to curry favor with the White House. Trump has welcomed their overtures and named venture capitalist David Sacks as artificial intelligence and crypto czar.

Republicans have mixed views on the proposal

There's no unanimity about the provision among congressional Republicans, even among those who are Big Tech critics.

Sen. Josh Hawley of Missouri told BI that he opposed the proposed moratorium, saying he didn't "want to tamp down on people's efforts to address" issues posed by AI.

"I would think that, just as a matter of federalism, we'd want states to be able to try out different regimes that they think will work for their state," Hawley said. "And I think in general, on AI, I do think we need some sensible oversight that will protect people's liberties."

Sen. Ted Cruz of Texas, meanwhile, told BI he was "very supportive of the principle," saying that AI should be regulated via national standards.

He also said he wanted to take an approach to AI similar to the one President Bill Clinton took on the internet in the 1990s — applying a "light touch regulatory approach" in order to win the AI race.

Silicon Valley shouldn't be celebrating yet.

The House Energy and Commerce Committee will debate the provision and the rest of its section of the sweeping proposal on Tuesday. Other top House committees will need to approve their own language before a final bill can be brought to the floor. House Republicans are still divided on other matters, including to what extent to cut Medicaid, a federal program that covers 72 million Americans, predominantly with low incomes or disabilities.

Even if the AI provision passes the House, it still needs to pass a special parliamentary review in the Senate. To ram Trump's bill through expected Democratic opposition, Republicans must use a special procedure known as reconciliation. The trade-off is that all provisions of reconciliation bills must be primarily fiscal in nature.

It's unlikely, as Bloomberg News reported, that the AI provision would meet that high bar. If it fails to, Republicans would be forced to strip it out of the bill or risk losing the special power that allows them to doge a likely Democratic-led filibuster that would effectively kill the entire bill.

"I don't know whether that provision will survive on reconciliation, but as a substantive matter, it's a policy I support," Cruz said.

• Sen. Mark Kelly sold his Tesla, saying he could no longer stand the association with Elon Musk.
• The ex-astronaut has chosen a Chevy Tahoe as his new ride.
• Kelly and Musk once had a friendly relationship, but it has collapsed recently.

Sen. Mark Kelly of Arizona on Friday became one of the highest profile figures yet to ditch his Tesla in favor of a new ride, channeling the growing backlash against billionaire Elon Musk.

"Elon Musk kind of turned out to be an asshole," Kelly, a Democrat, said in a video posted on X, explaining why he sold his car. "And I don't want to be driving a car built and designed by an asshole."

Kelly pulled up to Senate votes on Friday in front of the US Capitol in a 2025 Chevy Tahoe Z71, a spokesperson confirmed to Business Insider. Unlike his former Tesla, it is an all-gas vehicle. It gets an estimated 15 miles per gallon city, 20 mpg highway, and 17 mpg combined.

Chevy Tahoes are manufactured in Texas.

Tesla is increasingly bearing the brunt of Musk's rapidly declining popularity. Tesla shares are down more than 50% from their highs, and protests are hitting showrooms across the country. It's unmistakable that the company is paying the price for Musk's ties to the White House DOGE office.

Musk serves as the de facto leader of DOGE, which has targeted government offices for layoffs. Musk previously claimed credit for dismantling the US Agency for International Development (USAID), saying he fed it into "the woodchipper."

Trump made a show of buying a Tesla earlier this week, showcasing a variety of the automaker's vehicles at the White House.

Kelly once got along with Musk. The former NASA astronaut has repeatedly praised the private space sector, which Musk's SpaceX remains a dominant force in. The pair's relationship has soured in recent weeks. Musk recently called Kelly, a Navy veteran, a "traitor" for visiting Ukraine.

"The only oath I can think of that maybe Elon has sworn is an oath to his own checking account, to his pocketbook, an oath, maybe, to ruining the lives of veterans," Kelly later said during an interview on MSNBC.

According to YouGov, views of Tesla have plummeted since Musk entered the Trump administration. Public sentiment of the automaker is the worst it has been since the polling firm began tracking it in 2016, per data obtained by Sherwood.

• The White House's pause on federal grants and loans appears to be over.
• A memo sent by Matthew J. Vaeth at the OMB on Wednesday says that the memorandum is no longer in effect.
• A federal judge later said that he would issue an order to block the freeze.

The White House's controversial federal grants and loans freeze appears to be over.

A memo sent by Matthew J. Vaeth at the Office of Management and Budget on Wednesday, January 29, and addressed to the heads of executive departments and agencies, says that the memorandum is no longer in effect.

"OMB Memorandum M-25-13 is rescinded. If you have questions about implementing the President's Executive Orders, please contact your agency General Counsel," the memo, seen by Business Insider, reads. M-25-13 was the memo that the OMB, which oversees federal agencies and the federal budget, sent out Monday, pausing nearly all federal grants and loans.

On Wednesday afternoon, a federal judge said he intended to block the order after White House press secretary Karoline Leavitt said the freeze was still in effect.

"I'm inclined to grant the restraining order," U.S. District Judge Jack McConnell, a Rhode Island-based appointee of President Barack Obama, said during a court hearing, according to Politico. "I fear that the administration is acting with a distinction without a difference."

Earlier, Leavitt confirmed that the OMB order had been withdrawn. She said Trump's earlier executive orders, which imposed a freeze on new regulations and terminated diversity, equity, and inclusion programs, remain in effect.

"This is NOT a rescission of the federal funding freeze," Leavitt wrote on X. "It is simply a rescission of the OMB memo. Why? To end any confusion created by the court's injunction. The President's EO's on federal funding remain in full force and effect, and will be rigorously implemented."

Some Democratic lawmakers quickly took a victory lap, celebrating the OMB order's demise.

"This is Trump's first major loss. When we fight, we win," Rep. Alexandria Ocasio-Cortez of New York wrote on X.

Other Democrats cautioned that just because the OMB order was rescinded does not mean the broader fight is over.

"I think all they know is they got a backlash they didn't expect, and so we're not assuming the rescission is to be taken as a resolution," Sen. Tim Kaine of Virginia told reporters at the Capitol. "So we're going to be on the floor tonight raising hell about this. I'm going to meet with my statewide Head Start programs right now. We're expecting that this battle is just beginning."

Sen. Chris Murphy, a Connecticut Democrat, said the White House may have exacerbated the situation.

"What that order may have been designed to do is circumvent the court order," Murphy told reporters. "So everybody read that memo and thought crisis averted. The crisis might have just deepened."

Murphy said the scope of Wednesday's White House order is unclear since OMB may have just rescinded the controversial order but not the underlying funding freeze.

Congressional lawmakers, including some Republicans, expressed confusion over the extent of the initial memo. Popular charities, including Meals on Wheels, were unclear if the federal grants they received would continue to keep money following. Lawyers advised NGOs to ensure they had enough cash to wait out the pause.

The Trump administration, the Office of Management and Budget, and the Office of Personnel Management did not respond to a request for comment from BI.

Trump repeatedly said on the campaign trail that he would test the extent of presidential power to cut federal spending unilaterally. He and his allies view a Nixon-era law as unconstitutional, and the initial OMB memo appeared to defy the law that leaves the executive branch only narrow grounds to refuse to spend funds approved by Congress.